Tiny Slovenia Fills Big Shoes
As It Wraps Up EU Presidency

Seven years ago, when George W. Bush made his first trip to Europe as president, he stopped at the palatial retreat of Brdo pri Kranju north of the Slovenian capital Ljubljana, where he met Russia’s Vladimir Putin for the first time.

“We were not in NATO yet, and Russia didn’t want the meeting to take place on NATO territory,” said Slovenia’s ambassador to the United States, Samuel Zbogar. “On the other hand, we are not hostile to Russia, so they picked us.”

In early June, Bush will return to Europe for the last time as president, again stopping in the Slovenian capital for the two-day U.S.-EU Summit that’ll address Kosovo’s independence, rising oil prices and growing world hunger, among other things.

Only this time, instead of being a wannabe of the European Union, Slovenia now occupies the rotating six-month presidency of the exclusive 27-member club — an honor never before given to any of the newly independent nations of Eastern Europe. As such, the little Alpine country provides guidance to 500 million Europeans on everything from Darfur and Zimbabwe to global warming and the falling dollar.

“It’s kind of symbolic in a way, isn’t it?” mused Zbogar. “We were the first one to leave Yugoslavia in 1991, when we were on the agenda of the EU. And now, 17 years later, we are at the helm of the EU, and we’re putting Kosovo on the agenda. A circle is being completed.”

Zbogar, 46, who’s been in Washington for the past three and a half years, said his posting will probably end shortly after Slovenia hands over the EU presidency to France on June 30. During his time in Washington, the athletic diplomat and avid runner has done the Army Ten-Miler, the ACLI Capital Challenge, Arlington’s Marine Corps Marathon and the famed Boston Marathon, most recently clocking in at three hours and 57 minutes. He’s also started a foundation to eradicate land mines in the Balkans; so far, Zbogar’s marathon efforts have raised ,000 for the cause (also see Nov. 8, 2007, news column of the Diplomatic Pouch).

During his eventful posting, Zbogar also helped to debut Slovenia’s impressive embassy along California Street in Washington’s upscale Kalorama district. The mission, previously the Yugoslav Embassy, was allocated to Slovenia in 2001 and recently renovated at a cost of million by Powe Jones Architects. The ambassador and his family live on the top floor of the four-story structure, which was officially inaugurated by Slovenia’s foreign minister, Dimitrij Rupel, last September.

“We changed a lot of things about this building, especially the huge antenna on the top, which provided a direct communication link with Belgrade,” the ambassador joked. “It was bigger than the building itself.”

In many ways, the embassy’s new design — with its spacious terrace, wide picture windows and panoramic vistas — reflects Slovenia’s break with its communist, Yugoslav past and its embrace of democratic values such as openness and transparency.

In truth, Slovenia has about as much in common with the other former Yugoslav republics as, say, the former Soviet republic of Estonia has with Turkmenistan.

“We were all together in the same state for over 70 years, but we were very different even when we were part of Yugoslavia,” Zbogar explained. “We were under the Austro-Hungarian Empire for 1,000 years, and we’re developed and industrial, while other parts of Yugoslavia were not.”

Tiny Slovenia, slightly smaller than New Jersey, is sandwiched among much larger Italy, Hungary, Austria and Croatia, with a sliver of coastline along the Mediterranean Sea. The first country to declare itself free of the collapsing Yugoslav confederation, it is today the most prosperous of all the former Soviet and Yugoslav republics, with annual gross domestic product growth of 6.1 percent, inflation at 3.6 percent, unemployment at only 4.9 percent, and an export-driven economy dominated by pharmaceuticals, electronics, furniture and crystal glass.

“When we declared independence in 1991, our annual per-capita purchasing power was ,000 and Serbia’s was ,000,” said the ambassador. “Today, ours is ,000 and Serbia’s is still ,000.

“We were already developed within Yugoslavia, so after the first few years we had to reposition ourselves and export to the West,” Zbogar continued. “Obviously, we have had good economic policies in place for the past 17 years. At the beginning, we were very careful with foreign investment because we wanted to strengthen the economy. Now we are more open, and we wish to get more investment, especially from the United States.”

The country already boasts .5 billion worth of foreign direct investment from leading multinationals including France’s Renault, Switzerland’s Sandoz, and U.S. giants IBM, Goodyear and Microsoft.

On Jan. 1, 2007, Slovenia adopted the euro as its official currency, becoming the first EU member state from the 2004 enlargement to do so. Exactly one year later, Slovenia took over the presidency of the EU, prompting this remark from Daniel Fried, U.S. assistant secretary of state for European and Eurasian affairs: “Slovenia will be faced with immediate and tough issues, but by happy coincidence the toughest issue and the most immediate one, Kosovo and its final status, is the issue on which Slovenia is the most prepared. That’s because, to state the obvious, you know the ground, the players, the culture and the issues.”

“The whole Kosovo transition went smoothly,” said the ambassador, whose previous posts include Zagreb, New York and Beijing. “Many people expected violence after the declaration, but on the contrary many states recognized Kosovo, and the EU decided to send 2,000 judges and police officers to help monitor implementation of minority rights and put together the whole judicial system.”

The EU will also officially take over all policing and supervisory powers from the United Nations — which had administered the autonomous province since Western forces expelled the Serb army in 1999 — when Pristina adopts a state constitution in mid-June declaring Kosovo “an independent, sovereign, democratic, unique and indivisible state.”

Unfortunately, Slovenia’s speedy recognition of Kosovo — 90 percent of whose 2 million inhabitants are Albanian-speaking Muslims — came at a steep price: the immediate withdrawal of Serbia’s ambassador from Ljubljana.

Also opposed to Kosovo’s independence are Russia, Greece, Cyprus and Spain, though most EU members including heavyweights France, Germany, Italy and the United Kingdom have already recognized the world’s newest country, as have the United States, Canada, Japan, Turkey and Taiwan.

“For Serbs, this is a very sensitive issue, but the truth is, Serbia hasn’t had sovereignty over Kosovo since 1999, when [Slobodan] Milosevic started the war,” Zbogar argued. “Nobody’s comfortable that Kosovo declared independence without Serbia’s agreement, but they were all bad options, and independence was the least worst option.”

He added: “For 15 years, Serbia was under an economic embargo because of the wars they were involved in. That’s why we are pushing this Serbia Stabilization [and] Association Agreement, as a first step toward [Serbia] becoming a member of the EU.”

The country, however, remains split among ultra-nationalists who’d rather rebuff the European Union for its recognition of Kosovo — Serbia’s historic heartland and home to a sizeable Serb minority — and pro-West politicians who’d like to see the country eventually enter the EU.

“We have to be optimistic. The EU is extending the hand of friendship to Serbia, and we hope Serbia will take it,” Zbogar said. “They must break with this feeling that everybody hates them, that everybody is against Serbia.”

Besides bringing the focus of the EU to the Western Balkans, Slovenia has also made a priority of promoting intercultural dialogue during its presidency, as well as trying to stop global warming by reducing greenhouse gas emissions around the world. It’s also been prepping for the upcoming U.S.-EU Summit, which Zbogar says will be an ideal time to reflect on how much things have changed since Bush’s first visit to Slovenia in 2001.

“During his first term in office, the big issue was Iraq and that was the low point,” Zbogar told The Diplomat, noting that millions of people across Europe were shocked to see TV pictures of U.S. torture cells at Guantánamo Bay and Abu Ghraib.

“This is one of the reasons you had anti-American feelings among the public, though it was really opposition against the policies of the Bush administration,” he said. “Since then, relations with the administration have really improved. The United States and the EU are the two engines of international relations, with trillion in bilateral trade and 14 million jobs on both sides of the Atlantic that depend on this trade.”

Trade between Slovenia and the United States, incidentally, comes to only 0 million, and Zbogar concedes that his government hasn’t been too successful at getting investment from the Slovenian-American community.

“More than 70 percent of our trade is within the euro zone, so from that point of view, joining the EU was good. No one regrets it, and for tourists, it really simplifies things. But for our companies, the falling dollar is a problem. This has affected trade negatively because our companies cannot afford to export. They aren’t competitive, and if they lower their prices, then they won’t cover their losses.”

Another serious problem is Slovenia’s stagnating population — which barely reached 2 million and is now on its way down.

“We will need immigrants in the future because of our aging population and low birth rate.” said Zbogar, listing the incentives his government offers would-be mothers to have more children. “If you have three kids, you get an extra tax rebate of around 0. We also give one year of 100 percent fully paid maternity leave, but it doesn’t help.”

Immigration will be key to replenishing Europe’s dwindling labor force, and on that front, the EU has been making progress opening up its borders. The bloc recently completed an expansion of the Schengen Zone, a 24-country area in Europe in which EU citizens can travel freely without a passport, with nine countries — Slovenia, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and the Czech Republic — officially joining the zone late last year.

But according to Zbogar, enlarging the EU itself beyond its current 27 members and the handful of countries slated to join in the next few years is not on the horizon anytime soon.

“The EU won’t expand much more because there is no mood for further expansion at the moment. It was a big enlargement when 12 new members came in,” he said. “All these countries were poor, so a lot of money is coming out of Brussels, and it’ll take time for the EU to digest this enlargement.”